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section 6621(c).1 After agreements of the parties, the question
we consider is whether the cost of the work performed on
petitioners’ towboat engines constituted a currently deductible
expense or whether it is to be capitalized.
FINDINGS OF FACT2
A. Background
During the taxable years 1992, 1993, and 1994, petitioners
were members of an affiliated group of corporations of which
Ingram Industries, Inc. (Ingram) was the common parent. Ingram
maintained its principal offices in Nashville, Tennessee, on the
date the petition was filed in this case. During the years in
issue, petitioners were a closely held, diversified group of
corporations engaged principally in the wholesale marketing and
distribution of microcomputer software and hardware; books and
prerecorded video cassettes; inland barge transportation
services; energy-related manufacturing, production, and
marketing; and insurance. The barge transportation service was
conducted by three wholly owned subsidiaries of Ingram--Ingram
Barge Co., Inc., Ingram Towing Co., Inc., and Great River Marine
Service, Inc.
1 All section references are to the Internal Revenue Code in
effect for the years under consideration, and all rule references
are to the Tax Court Rules of Practice and Procedure, unless
otherwise indicated.
2 The parties’ stipulation of facts and the exhibits are
incorporated by this reference.
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